Whole of Life

Whole of Life cover guarantees to pay out a lump sum, irrespective of when the holder dies. As there is no time limit, premiums are more expensive. A whole of life policy will pay out on the death of the life assured, whenever death occurs, provided that the policy is still in force. Premiums are payable either throughout life or until the life assured reaches a certain age stipulated in the policy - 75 is common - when premiums cease but life cover continues. Unlike term policies because a whole of life policy has an investment element it will, over time, also have a surrender value.   As payment of the benefit is inevitable, each premium is made up of a mortality element and a savings element - the latter to build up an investment fund to pay out the benefit on death. Whole of life policies tend to be more expensive than term assurance for the same level of cover. Whole of life policies possibly carry cash values on early surrenders, dependent on the type of policy, number of years in force and the company’s investment performance. It is unlikely, however, that there would be any surrender value in the early years of the policy Level Term Decreasing Term Assurance Convertible Term Assurance Family Income Benefit